Please disable Ad Blocker before you can visit the website !!!

Meta Short

by SignalFactory   ·  April 27, 2022 | 08:49:00 UTC  

Meta Short

by SignalFactory   ·  April 27, 2022 | 08:49:00 UTC  

Facebook’s parent Meta Platforms will release its first-quarter financial results on Wednesday afternoon. Investors are nervous about a reprise of the badly received fourth-quarter report.

Meta Platforms Inc. (NASDAQ: FB), commonly also known as Facebook, has enjoyed robust earnings and revenue growth during the past two years amid the COVID-19 pandemic. But now, the company is facing dual crises. Growth is slowing sharply in its core social networking businesses, including Facebook. And the company’s new strategy of focusing growth on the metaverse is running into major challenges from regulators and some shareholders. The biggest one: a Meta shareholder recently won regulatory approval for a third-party evaluation of the potential psychological, human rights, and other harms of the metaverse to users. The evaluation will be one issue that Meta shareholders vote on at the company’s annual general meeting, and a negative vote could threaten the company’s new strategy.

Among other things, Meta issued guidance for the March quarter that fell well short of Wall Street’s forecasts, as management disclosed that revenue growth has been slowed significantly by new privacy rules at Apple that make it harder to both target advertising and measure the effectiveness of ads. Analysts expect the company to report a significant year-over-year (YOY) decline in earnings per share (EPS) and the slowest pace of revenue growth in at least three years.

Meta said that the Apple changes would reduce 2022 revenue by about $10 billion.

The company also called out the challenges of competing with TikTok in the market for short videos. Meta has launched a rival service called Reels, which appears on both Facebook and Instagram, but the company has said its ability to make money from Reels lags behind other elements of its platforms, like the news feed and “stories.”

For the March quarter, Meta projected revenue of between $27 billion and $29 billion, below the former Wall Street consensus forecast of $30.1 billion. The forecast implies year-over-year growth in the 3% to 11% range. The current Street consensus call is for revenue of $28.3 billion, up 8%, with profits of $2.56 a share.

No doubt there will be scrutiny of the June quarter guidance. The Wall Street consensus call is for revenue of $30.7 billion, up 6% from a year ago, with profits of $2.81 a share.

There are many issues for Meta to navigate. Investors will be looking for an update on the company’s progress in routing around Apple’s “App Tracking Transparency” policy, which makes it harder for Meta to use the information on consumer activity on iPhones to target ads. They’ll also be listening for any updates on progress in the monetization of Reels.

The Street is also worried about the overall state of the digital advertising industry. Signs of softening have emerged in Europe as a result of nervousness tied to the Russian invasion of Ukraine, supply chains remain snarled, inflation is high, and worry is growing about the potential for an economic slowdown later this year. And while it is early to expect much solid news, investors will want a status report on the company’s gigantic investment in the metaverse.

The biggest issue is likely to remain how the company responds to the challenges posed by Apple’s policy change, he said. “A key focus on Meta remains the company’s ability to develop, test and deploy a post-privacy ad attribution model, and our checks suggest that this will more likely be a 2023 development,” Mahaney wrote.

RBC Capital analyst Brad Erickson wrote that half of the advertisers he spoke about within a recent round of channel checks were still reducing spending on Facebook. Some investors believe that the low end of the range of forecasts management gives for second-quarter revenue could point to a year-over-year decline, he said.

“Numbers aside, we think Meta will be aiming to establish a tone of recovery …while also trying to give investors a view towards improving Reels monetization and a stable outlook around its positioning relative to user privacy and the Metaverse,” he wrote. Erickson also expects commentary on challenges such as weakness in Europe and a slowdown in the launch of ad campaigns following Russia’s invasion of Ukraine, saying both factors could “weigh incrementally” on the company’s advertising business.

Meta Short (Sell)
Enter at: 174.47
T.P_1: 161.03
T.P_2: 149.00
T.P_3: 131.23
S.L: 207.77

All information on this website is of a general nature. The information is not adapted to conditions that are specific to your person or entity. The information provided can not be considered as personal, professional or legal advice or investment advice to the user. This website and all information is intended for educational purposes only and does not give financial advice. Signal Factory is not a service to provide legal and financial advice; any information provided here is only the personal opinion of the author (not advice or financial advice in any sense, and in the sense of any act, ordinance or law of any country) and must not be used for financial activities. Signal Factory does not offer, operate or provide financial, brokerage, commercial or investment services and is not a financial advisor. Rather, Signal Factory is an educational site and a platform for exchanging Forex information. Whenever information is disclosed, whether express or implied, about profit or revenue, it is not a guarantee. No method or trading system ensures that it will generate a profit, so always remember that trade can lead to a loss. Trading responsibility, whether resulting in profits or losses, is yours and you must agree not to hold Signal Factory or other information providers that are responsible in any way whatsoever. The use of the system means that the user accepts Disclaimer and Terms of Use. Signal Factory is not represented as a registered investment consultant or brokerage dealer nor offers to buy or sell any of the financial instruments mentioned in the service offered. While Signal Factory believes that the content provided is accurate, there are no explicit or implied warranties of accuracy. The information provided is believed to be reliable; Signal Factory does not guarantee the accuracy or completeness of the information provided. Third parties refer to Signal Factory to provide technology and information if a third party fails, and then there is a risk that the information may be delayed or not delivered at all. All information and comments contained on this website, including but not limited to, opinions, analyzes, news, prices, research, and general, do not constitute investment advice or an invitation to buy or sell any type of instrument. Signal Factory assumes no responsibility for any loss or damage that may result, directly or indirectly, from the use or dependence on such information. All information contained on this web site is a personal opinion or belief of the author. None of these data is a recommendation or financial advice in any sense, also within the meaning of any commercial act or law. Writers, publishers and affiliates of Signal Factory are not responsible for your trading in any way. The information and opinions contained in the site are provided for information only and for educational reasons, should never be considered as direct or indirect advice to open a trading account and / or invest money in Forex trading with any Forex company . Signal Factory assumes no responsibility for any decisions taken by the user to create a merchant account with any of the brokers listed on this website. Anyone who decides to set up a merchant account or use the services, free of charge or paid, to any of the Forex companies mentioned on this website, bears full responsibility for their actions. Any institution that offers a service and is listed on this website, including forex brokers, financial companies and other institutions, is present only for informational purposes. All ratings, ratings, banners, reviews, or other information found for any of the above-mentioned institutions are provided in a strictly objective manner and according to the best possible reflection of the materials on the official website of the company. Forex trading is potentially high risk and may not be suitable for all investors. The high level of leverage can work both for and against merchants. Before each Forex investment, you should carefully consider your goals, past experience and risk level. The opinions and data contained on this site should not be considered as suggestions or advice for the sale or purchase of currency or other instruments. Past results do not show or guarantee future results. Neither Signal Factory nor its affiliates ensure the accuracy of the content provided on this Site. You explicitly agree that viewing, visiting or using this website is at your own risk.

Signal Factory is now on Telegram

make sure to join our Telegram channel now and you will not miss any update